On 2nd December 2021, KCB Bank Group release a public announcement to update on the proposed acquisition of African Banking Corporation Tanzania.
KCB explains that on 26th November 2020, it had entered into a share purchase agreement with ABC Holdings for the proposed acquisition of its subsidiary African Banking Corporation Tanzania.
Completion of the transaction was subject to certain conditions that are customary for transactions of this nature including receipt of all regulatory approvals.
As of the date hereof, certain regulatory approvals have not been received within the prescribed timeframe specified in the Agreement.
As a result, without further agreement by the parties to extend the long stop date, the Agreement has been terminated and, accordingly, the parties will not proceed to complete the Transaction as previously envisaged.
Despite the above, KCB will continue exploring and pursuing attractive regional expansion opportunities in order to enhance our regional participation, accelerate our growth and maintain sustainable long-term African success in line with our expansion and growth strategy.
After a peak of 59 licensed banking institutions operating in Tanzania in 2017, the number has descended to 53 in 2018, 51 in 2019, 49 in 2020, and 47 in 2021, following a number of takeovers and mergers.
It is plausible to expect that the impact of the Covid-19 pandemic will put additional pressure on the sector and further reduce the number of banks successfully operating in Tanzania.